In a landmark agreement, Disney and Reliance Industries Limited (RIL) have announced the signing of binding definitive agreements to form a joint venture (JV) that will combine the businesses of Viacom18 and Star India . The deal, which has been in the works for months, will create a media behemoth across TV broadcasting, streaming, movies and sports.
Deal details
As part of the transaction, RIL has agreed to invest around Rs 11,500 crore ($ 1.4 billion) into the JV for its growth strategy . The deal values the joint venture at Rs 70,352 crore ($ 8.5 billion) on a post-money basis, excluding synergies . Post completion of the merger, the JV will be controlled by RIL with 16.34% stake. Meanwhile, Viacom18 will have 46.82% stake and Disney will own about 36.84% .
Leadership and vision
Nita Ambani will be the Chairperson of the Joint Venture, with Uday Shankar as Vice Chairperson providing strategic guidance to the JV . Nita Ambani is the wife of RIL chairman Mukesh Ambani and the founder-chairperson of Reliance Foundation. Uday Shankar is the co-founder of Bodhi Tree Systems and former chairman of Star India.
“This is a landmark agreement that heralds a new era in the Indian entertainment industry. We have always respected Disney as the best media group globally and are very excited at forming this strategic joint venture that will help us pool our extensive resources, creative prowess, and market insights to deliver unparalleled content at affordable prices to audiences across the nation,” said Mukesh Ambani, Chairman and Managing Director, RIL.
Portfolio and offerings
The proposed combined Star-Viacom18 entity will be a dominant force in the TV broadcasting industry, with more than 100 TV channels like Star Plus, Colors and Star Sports . The entity will also have two streaming platforms, Disney+ Hotstar and JioCinema, with dominant market shares in subscription and advertising video-on-demand segments .
The JV will also be granted exclusive rights to distribute Disney films and productions in India, with a licence to more than 30,000 Disney content assets, providing a full suite of entertainment options for the Indian consumer.
Timeline and challenges
The transaction is subject to regulatory, shareholder and other customary approvals and is expected to be completed in the last quarter of Calendar Year 2024 or the first quarter of Calendar Year 2025 .
The merger development comes at a time when the proposed deal between Sony Group-Culver Max Entertainment and Zee Entertainment collapsed last month due to disagreement over who would lead the combined company. The deal also comes amid intense competition in the Indian OTT market from players like Netflix, Amazon Prime Video, Zee5 and others.
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